BIR Ruling [DA-009-98]

January 20, 1998 BIR RULING [DA-009-98] Bureau of Customs Manila Gentlemen : This refers to the letter dated December 20, 1997 of Kultura Knitex Corporation, 3rd West Crame, San Juan, Metro Manila, in effect requesting for a ruling exempting from the 2% excise tax imposed under then Section 151(a)(2) of the Tax Code, as amended by R.A. No. 7729, its importation of 4,609.500 metric tons or 3,067 jumbo bags of "CONCH" Portland Cement which arrived on December 8, 1997 under Reg. No. ESL-001 with Entry No. 222793. It appears that you refused to release the said shipment unless the corresponding excise tax due thereon in the amount of P193,681.00 is paid, on the ground that cement falls under the definition of "minerals" and/or "mineral products". In BIR Ruling No. 002-98 dated January 8, 1998, addressed to the Kultura Knitex Corporation, this Office held that xxx xxx xxx In reply, please be informed that Revenue Regulations No. 13-94 dated July 20, 1994 which governs the taxation of Minerals and Mineral Products includes in its coverage under the term "Other Non-Metal", cement materials, but not the finished product cement. Accordingly, not being a mineral product, cement is exempt from the 2% excise tax but subject to the 10% value-added tax imposed under Section 107 (a) of the Tax Code of 1997. Accordingly, cement not being a mineral product is exempt from the 2% excise tax. However, the importation is subject to the 10% value-added tax imposed under Section 107 (A) [ formerly Section 101 (a) ] of the Tax Code of 1997. cdt Very truly yours, (SGD.) SIXTO S. ESQUIVIAS IV Deputy Commissioner (Legal and Enforcement Group)